Congress touts 'green energy,' but bill is black and blue

Lawmakers are even more industry-friendly than the administration

Four years ago, in his
National Energy Policy, Vice President Dick Cheney recommended
building 1,300 to 1,900 new power plants, 38,000 miles of new gas
pipelines, and 255,000 miles of transmission lines. Then last
month, in a speech before the National Small Business Association,
President Bush added a few more energy priorities to that list.
He’d like to build new nuclear power plants and change
existing laws to "reduce uncertainty" in the nuclear licensing
process. Bush also proposed constructing the nation’s first
new oil refineries since 1976 — suggesting they be built on
military bases slated for closure — as well as simplifying
the U.S. Environmental Protection Agency’s rules for
permitting refineries. In his budget request to Congress, he asked
for $6.7 billion in tax breaks for the energy industry.

All of this, however, is small potatoes compared with what Congress
is proposing.

In mid-April, the U.S. House of
Representatives passed its energy bill, which included $8 billion
in subsidies for the energy industry. Although the Senate
isn’t expected to vote on its version until the end of May,
it has passed its 2006 budget, which includes $11 billion in energy
subsidies.

The House has passed some version of the
energy bill five times in the last four years, but the Senate has
repeatedly rejected it. With some of the tax breaks already out of
the way, however, the bill may have a shot at passing this year.
Sen. Pete Domenici, R-N.M., chair of the energy and natural
resources committee, has praised the spending bill, and vowed to
use the money to craft an energy package that would maximize both
energy conservation and energy production.

Meanwhile, the
president is urging Congress to set the energy bill on his desk by
August. And Westerners are bracing for the immediate and sweeping
impacts the legislation would have on their region.

Longer days for the public — and sunnier days for
industry

When the House passed the energy bill by a vote
of 249 to 183, it approved everything from extending Daylight
Savings Time by two months every year to creating a pilot program
for making ethanol from sugarcane. And although environmentalists
are indignant over provisions in both the House energy bill and the
Senate budget that would open Alaska’s Arctic National
Wildlife Refuge to energy development, that’s just the tip of
the iceberg.

As passed, the House bill would exempt
refinery owners such as BP, ChevronTexaco, ExxonMobil and
ConocoPhillips from liability for contaminating groundwater with
MTBE, a cancer-causing gasoline additive that has polluted more
than 3,000 underground water sources in California alone.

The House bill would also block the EPA from regulating hydraulic
fracturing or "frac’ing" — the process by which energy
companies inject chemicals such as diesel fuel, benzene and
formaldehyde into coal seams to boost oil and gas production.
Frac’ing, which was pioneered by Halliburton in the 1940s, is
a growing practice across the West, particularly in New
Mexico’s San Juan Basin, Wyoming’s Powder River Basin
and northwestern Colorado. Under pressure from Dick Cheney’s
Energy Task Force — and over the objections of its own
scientists — the EPA has backed off its earlier efforts to
regulate the practice, despite evidence that frac’ing has
contaminated underground drinking water sources (HCN, 12/20/04:
Conscientious Objectors).

The House bill also outlines
how the U.S. departments of the Interior and Agriculture should
handle applications for oil and gas leases, permits and surface-use
plans. Under current regulations, federal managers can approve or
reject applications. Under the changes, however, federal managers
would have 30 days to either approve or defer an application. If
they defer, they would be required to tell the company how to
change its application to ensure it is approved the next time; the
company would then have two years to revamp its proposal.

The bill would also require the federal government to compensate
oil and gas companies for the cost of complying with the National
Environmental Policy Act, and reduce or suspend the royalties
corporations pay into the U.S. Treasury when they drill on public
land or in offshore waters. Combined, these provisions represent
millions more in federal subsidies.

The bill would also
boost the nuclear industry by subsidizing nuclear power at 1.8
cents per kilowatt hour, and authorizing $30 million for the
research and development of new uranium mining technologies. It
would renew the Price Anderson Act for 20 years. That 1957 law caps
the nuclear industry’s liability for accidents at $9 billion
(current estimates for accident damages are about $600 billion).

"Nuclear power is the cancer industry," says Dr. Helen
Caldicott, a pediatrician and founder of the Nuclear Policy
Research Institute. The radioactivity from nuclear power, she says,
"will over time produce an epidemic of cancer, particularly among
children who are vulnerable to it," she says.

President
Bush told the National Small Business Association that nuclear
energy emits "no air pollution or greenhouse gases." Caldicott says
that claim is ludicrous. Enriching uranium to create nuclear fuel,
she explains, requires a great deal of electricity and is
responsible for vast releases of greenhouse gases. Of the call for
new plants, she says: "It’s an absolutely criminal act to
build new nuclear power plants and dig up uranium."

What about renewables?

President Bush and
other prominent Republicans, such as House Resources Committee
Chair Richard Pombo, R-Calif., have emphasized the bill’s
commitment to renewable energy and to consumers. But while its
1,000-plus pages contain provisions involving renewable energy and
energy efficiency, they are often vague, and have longer time
frames for completion than the nuclear and fossil fuel provisions.
For example, the section mandating that the federal government
assess renewable energy potential on public lands simply requires
the Interior secretary to "seek to have approved non-hydropower
renewable energy projects located on the public lands" within 10
years.

It’s hard to find any good news for the
renewable energy industry within the bill, says Marchant Wentworth,
Washington, D.C., representative for clean energy with the Union of
Concerned Scientists. "There are very minor tax credits for
special, qualified facilities for renewable energy, but it
doesn’t really require anybody to do anything" in terms of
renewable energy or energy efficiency, he says.

Meanwhile, fiscal conservatives say it is irresponsible to grant
tax cuts to energy companies — now reaping record profits
from high energy costs — at a time when the nation is facing
a $450 billion deficit and fighting a $9 billion-a-month war in
Iraq.

"(The energy bill) does nothing to meet our energy
needs in a more reliable, less expensive, environmentally friendly
way," says Jill Lancelot, president of the Washington, D.C.-based
Taxpayers for Common Sense. Rather, she says, it amounts to
corporate welfare. "These are very, very wealthy oil and gas
companies, who on the one hand, are touting to their stockholders
in their promotional literature how well they are doing," she says.
"On the other hand, they are coming with their hands out to
Congress, saying, ‘We need federal support.’ "